When you owe a tax agency a payment, you are expected to make that payment accurately and on time. If you owe the Internal Revenue Service (IRS) or the Florida Department of Revenue (DOR) taxes, it’s important to understand the Florida late-file penalties and how to get back in good standing.
Business and individual taxpayers alike have to take back taxes seriously. If penalties are ignored, they can become a much bigger issue. You can face penalties, investigation, and even criminal consequences.
If you fail to file your taxes on time or fail to pay the amount you owe, state and federal tax agencies can act to recover those taxes. The IRS Automated Underreported Program led to $7.7 million in additional assessed tax in 2024 and closed 6.1 million delinquent accounts.
Federal Failure to File Penalty
The IRS imposes a failure to file penalty if you do not file your tax return by the required due date. The penalty amount relies on which tax return was filed late:
- Individual and many business tax returns. This penalty is 5% of the tax that was due and is assessed each full or partial month that you are late filing the return. The maximum penalty that can be assessed is five months, as it is capped at 25%. This penalty is reduced if you are also facing failure to pay penalties.
- Partnership returns. Failure to file penalties for late partnership returns can last for up to 12 months. Depending on the type of partnership, the penalty may be $245 each month multiplied by the number of partners, 5% of the unpaid tax, or other calculations.
- S corporation returns. These penalties are also charged for up to 12 months and are calculated using the base penalty rate and the number of people who are shareholders.
When the penalty is assessed, you receive a notice of it. If you don’t pay the penalty, then it can accrue interest. The IRS assessed 22.4 million penalties for the failure to pay for individual, estate, and trust income taxes in 2024.
Federal Failure to Pay Penalty
The failure to pay penalty is applied by the IRS if you failed to pay the tax you owed. It is a percentage of the taxes you owe, not more than 25%. The calculation of the percentage is different depending on whether you did not pay the amount stated on your return, or you failed to pay a tax that was not reported on the return.
Florida Failure to Pay or File Penalties
The Florida DOR can also assess penalties for late or unpaid taxes. This includes:
- Failure to file a timely tax return: This results in a penalty of 10% of the tax that is due for the first month and can be assessed for up to five months.
- Failure to file a return as a corporation: This has a penalty of $50 for each month the return is not filed, up to six months. It applies only to corporations that are required to file federal tax returns.
Individuals have certain taxes they must pay to the DOR, even though they do not have a personal state income tax. Businesses have many more responsibilities to the DOR.
Getting Back in Good Standing With the IRS and DOR
To get back in good standing with the IRS and DOR after late or unfiled taxes, it is essential that you file the necessary tax returns and pay off your debt. There are some things you can do to make this process easier on you and improve your standing. This includes:
- Requesting penalty abatement or a waiver of penalties, which can remove specific penalties like failure to pay under first-time abatement, or if you have a good reason for inciting the penalty
- Applying through the voluntary disclosure policy to report your non-payment
- Filing for an extension to file if you cannot pay your upcoming tax return by the due date, prior to the tax being due
- Applying for a payment plan if you cannot afford the full amount of your owed taxes, prior to the taxes being due
- Assessing other debt settlement options, like a payment plan or an offer in compromise, if you can’t pay back your tax debt
FAQs About Tax Returns Late-File Penalties in Florida
How Can You Get Out of a Late Filing Penalty?
There may be options for getting out of a late filing penalty for your taxes, such as penalty abatement. This may remove certain penalties, such as a late penalty, if you meet the requirements listed by the IRS. This may be a first-time penalty abatement or abatement because of a reasonable cause.
How Do You Fix Being Behind on Taxes?
If you are behind on your taxes, it is important to pay back the debt you owe and then pay your obligations on time and accurately. If you can’t pay, there may be other ways to deal with the debt. When you hire a tax preparation attorney in Jacksonville, FL, they can consider options like payment plans or an offer in compromise to resolve the liability and help prepare your future obligations.
What Is the Penalty for Filing Taxes Late in Florida?
The penalty for filing your taxes late in Florida depends on the kind of taxes you have filed late. There are different penalties for personal income taxes owed to the IRS or corporate income taxes owed to the DOR. There are both failure to file and failure to pay penalties.
Can Tax Penalties Be Forgiven?
Yes, tax penalties may be forgiven, depending on your tax standing and the cause of your penalties. The IRS offers first-time penalty abatement if you have a good history of tax compliance and no penalties for a certain time.
There is also a reasonable cause penalty abatement, which may apply if you tried to file your taxes on time, but factors outside your control stopped you. This may include unavoidable absences, illness, family emergencies, and more.
Hire a Tax Attorney at TaxSmith, LLC
At TaxSmith, LLC, we know how frustrating it can be to deal with tax penalties, especially when you have always been in good standing, or you couldn’t avoid the late payment. For over a decade, our firm has fought for the rights and financial needs of taxpayers in Florida.
Our firm can help. We understand the complexity of these tax codes and can offer you the necessary compassionate support and legal guidance. Reach out to our team today.
